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ICYMI: California's best-in-class workforce drove nation-leading productivity growth in 2025

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~ SACRAMENTO - According to new data from the U.S. Bureau of Labor Statistics (BLS), California's workforce has once again proven to be the driving force behind the nation's economy. In 2025, California workers increased productivity by 4.2%, representing about 14% of national output and delivering the largest contribution of any state to national productivity growth.

Governor Gavin Newsom praised California's workers, entrepreneurs, and innovators for their role in the state's economic success, stating that "investing in California delivers real results." As one of the largest economies in the world, California continues to demonstrate that a strong workforce, economic growth, innovation, and performance go hand in hand.

The BLS data also revealed that California's private-sector nonfarm businesses saw a productivity increase of 4.2% in 2025, accounting for nearly one-third of the nation's overall 1.8% productivity growth. In comparison to all 50 states and the District of Columbia, California was one of only two states to post productivity gains exceeding 4%.

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These impressive productivity gains were accompanied by strong job growth in California. The state added 131,534 jobs over the past year, more than any other state during the same period. Additionally, four of the nation's fastest-growing job markets through the first quarter of 2026 were located in California.

California's economic dominance is not limited to just productivity and job growth. According to a recent Bloomberg analysis, the Golden State outpaced all other states and developed nations in terms of economic performance in 2025. This marks a continuation of a 16-year growth streak for California, surpassing even Texas - which holds the title as second-largest state.

Furthermore, California boasts more businesses than any other state - including Florida and Texas - with over 4.3 million small businesses employing 7.6 million people. This supports strong job creation and expanded economic opportunities for workers across the state.

In addition to these achievements, California also leads the nation in key areas of economic strength and innovation, including new business starts, manufacturing, venture capital funding, high-tech businesses, and agriculture.

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In other recent news, California's investment in youth behavioral health has shown promising results across the state. New findings from multiple reports highlight the impact of the Children and Youth Behavioral Health Initiative (CYBHI), which has received more than $1 billion in funding. This initiative aims to improve mental health services for children and youth in California.

Governor Newsom also announced a first-of-its-kind partnership that will provide state agencies with Anthropic tools - a form of artificial intelligence - to improve government efficiencies and services for Californians. This partnership builds on the Governor's executive orders on generative artificial intelligence and government efficiencies.

Overall, California's best-in-class workforce continues to drive the state's economy forward, solidifying its position as a leader in economic growth and innovation. With continued investments in its workforce and initiatives like CYBHI and Anthropic tools, California is poised to maintain its economic dominance for years to come.

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